MGT 4350: Chapter 2. Charting a Company's Direction Its Vision, Mission, Objectives

strategic objectives are goals concerned primarily with an organizations

- Competitive Position - Market Standing

financial objectives are important for achieving

- Profits - Financial Strength - Shareholder Satisfaction

to implement a strategic plan what must a manager be able to do?

- direct organizational change - motivate employees - build and strengthen competitive capabilities

what are the obligations of a company's board of directors?

- evaluating the strategic leadership abilities of the CEO - ensuring that the company's financial reports are accurate - evaluating the company's direction and strategy

If a company's board of directors is strong and independent, what should it be able to do?

- guide and judge the CEO and other executives - certify to shareholders that the CEO is performing as the board expects - stop management from taking actions that are too risky or inappropriate

the most demanding and lengthy part of the strategy management process is

- implementing the strategy

what are lagging indicators?

- performance measurements resulting from decisions and activities in the past

employees at various levels within an organization are best served by performance objectives that

- relate specifically to what their departments are doing

an adjustment of strategy is most likely needed if the company is experiencing

- repeated failure to achieve performance goals - a drop in its market position

what is the role of a company's board of directors?

- to oversee top executives and ensure that they craft and implement an effective strategy - to ensure that the company is operating in the best interests of shareholders and other stakeholders

It is generally best for companies to craft objectives that (Select all that apply) A.Include a deadline for achieving the objective. B. can be measured. C. are broad and flexible. D. will be relatively easy to accomplish.

A, B

Performance targets should be set for the organization's A. separate businesses. B. product lines. C. individual work units. D. top managers only.

A, B, C

A company mission statement should do which of the following? (Select all that apply) A. Specify what services and products the company offers. B. Identify the company's customers or markets. C. Describe where the company expects to head in the future. D. Establish the company's own identity.

A, B, D

During the final stage of developing and implementing a company strategy, what factors often cause the company to adjust its objectives or mission statement? A. new opportunities B. new ideas C. well-established company traditions D. changing conditions

A, B, D

Which factors do managers consider when establishing performance objectives? (Select all that apply) A. economic conditions within the industry B. competition from other businesses C. the strategic visions of rival businesses D. the company's internal capabilities

A, B, D

Why should the mission statement not focus on the company's goal of making a profit? (Select all that apply) A. The mission statement should define "who we are and what we do." B. All commercial businesses aim to make a profit. C. Making a profit will actually distract the company from achieving worthwhile goals. D. Making a profit is best seen as a result of the company's actual mission.

A, B, D

Stretch objectives are helpful because they (Select all that apply) A. motivate employees to be more productive. B. allow the company some extra time to accomplish its goals when unexpected obstacles slow the work. C. help an organization perform at its full potential. D. prevent employees from settling for a comfortable level of performance.

A, C, D

Which of the following are not likely to happen if a company's financial objectives are met or exceeded? (select all that apply) A. Revenues will decrease. B. The company's creditors will be pleased. C. Senior executives will be fired. D. The company will go into bankruptcy.

A, C, D

Which of the following are part of the fifth and final stage for crafting and executing a company's strategy? (Select all that apply) A. monitoring developments B. beginning to define core values C. adjusting the mission statement D. evaluating performance

A, C, D

Which statements are true about specific, measurable goals? (Select all that apply) A. They motivate personnel to try harder. B. They restrict an organization to an undesirably narrow course of action. C. They help an organization remain focused on what it is trying to accomplish. D. They help an organization track its progress.

A, C, D

Why do companies designate a set of core values? (Select all that apply) A. to guide the behavior of personnel B. to avoid dealing with clients with undesirable ethics C. to encourage certain beliefs, traits, and behavioral norms D. to guide the company as it pursues its vision and mission

A, C, D

A measurement system that links financial performance goals with strategic goals is called a A. balanced scorecard. B. stretch objective. C. company strategy. D. leading indicator.

A. balanced scorecard

To mobilize employee support for a new strategic vision for a company, executives should A. give convincing reasons for taking the organization in a new direction. B. remind employees that they failed to make the company prosper under the old system. C. summarize the plan on the internal company website rather than discussing it in person with all employees D. avoid discussing employee concerns and instead talk about the effort spent in creating the new vision.

A. give convincing reasons for taking the organization in a new direction.

When charting a company's direction, why do managers set objectives? A. to establish performance targets that the managers hope to achieve, using the company's mission and vision B. to establish a strategic hierarchy for the entire company C. to help define the company's mission statement D. to help employees see the difference between the company's vision and mission

A. to establish performance targets that the managers hope to achieve, using the company's mission and vision

A company's mission statement describes the organization's A. aspirations B. present business. C. present purpose. D. future strategic course.

B, C

Which factors do managers consider when establishing performance objectives? (Select all that apply) A. the strategic visions of rival businesses B. competition from other businesses C. the company's internal capabilities D. economic conditions within the industry

B, C, D

What is a stretch objective? A. a managerial tactic that involves adding numerous goods and services to what the company has traditionally offered B. a performance strategy that seeks to include as many personnel as possible C. a performance target that will require significant effort to achieve D. a goal that can be adjusted to accommodate changing conditions

C. a performance target that will require significant effort to achieve

When conditions outside or inside the company change enough to cause substantial disruptions, managers should A. halt the implementation of the strategic plan and resume later when conditions are more favorable. B. make small changes to the strategic plan, but only if the changes will require little time or effort. C. reevaluate the organization's direction and strategy. D. stay with the strategic plan and trust that it will work eventually.

C. reevaluate the organization's direction and strategy.

Which of the following groups has as a primary responsibility the need to challenge a chief operating officer (CEO) who is acting inappropriately in his position? A. other top executives B. shareholders C. the board of directors D. managers at all levels in the company

C. the board of directors

Which mission statement is written in the most effective manner? A. "to inspire flights of fancy and be there whenever our customers need us" B. "to help people achieve their dreams" C. "to make a profit every quarter of every year" D. "to provide nutritious food at an affordable price, served with a smile"

D. "to provide nutritious food at an affordable price, served with a smile"

Honor, integrity, teamwork, superior customer service, and innovation are examples of company A. objectives. B. operating strategies. C. functional-area strategies. D. core values

D. core values

The most reliable leading indicators are A. a robust company vision and mission statement. B. financial statements over at least the past three to five years. C. core values that have become an essential component of the organization. D. strategic outcomes that measure competitiveness and market position.

D. strategic outcomes that measure competitiveness and market position.